Budgetary Dilemmas in Pakistan: Costs and Benefits of Sustained Defense Expenditures
NAVAL POSTGRADUATE SCHOOL MONTEREY CA DEPT OF NATIONAL SECURITY AFFAIRS
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The purpose of this paper is to assess the major macroeconomic impacts of defense expenditures on the Pakistani economy. This approach involves three interrelated steps. The first step identifies the economys main macroeconomic patterns and trends with an emphasis placed on the major problems currently facing policy makers. In particular, what structural problems currently constrain the economys growth What policy options are available to moderate these difficulties Which budgetary patterns are sustainable The second step examines the manner in which defense expenditures have interacted with the economy. What are the interdependencies between defense and overall growth Have defense expenditures contributed to the current structural imbalances If so, in what manner Have defense expenditures initiated macroeconomic change or simply reflected movements in the major aggregates The third step, through the use of a macroeconomic model, assesses the main factors identified in steps one and two. Here our main interest is to assess the manner in which the Pakistani economy might have evolved if the government had adopted alternative budgetary programs. Did defense and nondefense expenditures affect the economy in a similar manner If so, in what way Based on the findings from these historical simulations, a series of forecasts are made to the year 2000. Here we are interested in examining alternative defensenondefense expenditure patterns. Which types of expenditures would be most productive in alleviating the countrys structural imbalances Which budgetary strategies are sustainable What major impacts would result from a redirection of expenditures from defense to nondefense The philosophy underlying this approach stresses the importance of examining defense expenditures in the context of the governments overall development and budgetary strategies.
- Administration and Management
- Economics and Cost Analysis
- Government and Political Science